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As Sales Lag, VW Picks a New Leader for U.S.

Midway through an ambitious 10-year plan to become the world’s largest automaker, Volkswagen has hit a rough patch in the United States, with sales stagnating this year even as the rest of the industry has surged.

On Thursday, Volkswagen made a change, with the resignation of Jonathan Browning as the chief executive of the Volkswagen Group of America. He will be replaced by Michael Horn, 51, a company stalwart who has been head of its global aftersales division, which manages warranties and repairs.

The company said Mr. Browning, 54, left for personal reasons.

The automaker insisted on Thursday that it remained on track to sell 10 million vehicles a year worldwide by 2018, even as American sales for the company’s Volkswagen division have plunged 5.2 percent so far this year, to 374,000 vehicles — far behind its goal of 800,000 by 2018. Over all, total sales for all of Volkswagen’s brands in America fell 0.6 percent, as it received a boost from its Audi, Bentley and Lamborghini brands.

“Where we’re at this year was certainly planned,” Scott Vazin, a Volkswagen spokesman, said.

Volkswagen said the decline was the result of winding down certain models that are at the end of their product cycle, and expanding its network of dealers. It also is performing better elsewhere in the world, including China, where it is a top-selling automaker.

“The 800,000 goal by 2018 has been a pipe dream, but Volkswagen management in Germany has insisted it was sticking to it even when American management tried to downplay it,” said Michelle Krebs, a senior analyst for researcher Edmunds.com.

“In the U.S. market, the pie is not growing dramatically and the slices are becoming more even,” Ms. Krebs said. “Nabbing even a tenth of a point of market share is a big deal.”

The United States auto industry has maintained a solid recovery this year, with sales up 8.4 percent. The industry is on track to sell 15.6 million vehicles this year for the strongest performance since the recession began. Ford, for example, said Thursday that it would hire 3,300 salaried workers, especially for technology jobs, in the United States next year to meet its surging demand.

But even as other automakers reap the benefits of a steady recovery in employment that has brought higher demand for trucks and new car models featuring advanced entertainment and fuel-efficient technology, the Volkswagen brand has faltered.

Volkswagen’s main challenge has been selling an older lineup in an increasingly competitive market. Volkswagen introduced no new models in 2013. Its Passat sedan, its highest seller in the United States after the Jetta compact, is three years old.

“It doesn’t take very long for vehicles to feel old when there are new models coming out at a blistering pace,” Ms. Krebs said. “The Ford Fusion and Honda Accord were new last year. The Nissan Altima preceded those by a few months. Chevrolet Malibu is new — again — this year.”

The automaker lost ground in the United States even as it invested more than $4 billion here since 2008, including $1 billion for a plant in Chattanooga, Tenn., that builds the Passat.

Those investments are continuing. Mr. Browning announced plans to invest an additional $5 billion in North America by 2015. And in May, the automaker unveiled a lavish, $135 million dealership for its VW and Audi brands in Manhattan.

“The company is very serious about this market,” Mr. Vazin said. “It really wants to grow.”

One distraction this year has been efforts by the United Automobile Workers to organize employees at the Chattanooga plant. In response, Volkswagen’s management has considered a German-style works council as a compromise between workers who want to unionize and right-to-work groups.

Under Mr. Browning, who joined the company in 2010, Volkswagen’s American sales appeared poised for significant growth, advancing 26 percent in 2011 and 35 percent in 2012.

“They really made a lot of progress with the new Jetta and Passat,” said Thomas Libby, an analyst with IHS Automotive. “They were really going in the right direction.” But now the 2018 benchmarks seem harder to accomplish, Mr. Libby said. “In this market, if you go a long time without new product, it’s hard to maintain share,” he said. “It’s important not to have a lull.”

A version of this article appears in print on December 13, 2013, on Page B1 of the New York edition with the headline: As Sales Lag, VW Picks A New Leader for U.S. Order Reprints|Today's Paper|Subscribe